IV:Dollar higher vs. yen, lower vs. euro after Spain auction
Investing.com - The U.S. dollar was trading close to two-and-a-half year highs against the yen on Thursday but turned broadly lower against the other major currencies after Spain saw borrowing costs fall sharply at an auction of government debt.
During European late morning trade, the greenback was lower against the euro, with EUR/USD rising 0.26% to 1.3098.
The euro found support after Spain’s Treasury sold EUR5.8 billion worth of debt, above the full targeted amount of EUR5 billion, with the yield on five-year bonds down to 3.99% from 4.20% at an auction last week.
Meanwhile, Italy saw borrowing costs fall to the lowest level since January 2010 at an auction of 12-month government bonds.
But investors remained cautious ahead of the outcome of the European Central Bank’s policy meeting later Thursday.
The ECB was widely expected to hold off cutting rates, but some market participants expected President Mario Draghi to flag the possibility of rate cuts later in the year.
The dollar was hovering close to two-and-a-half year highs against the yen, with USD/JPY up 0.25% to 88.10.
Investors continued to shun the yen amid expectations that Japan’s government, led by Prime Minister Shinzo Abe, will pressure the Bank of Japan to implement more aggressive easing measures at its policy meeting later this month as part of an effort to combat deflation.
The greenback was lower against the pound, with GBP/USD up 0.21% to 1.6055.
The greenback slid to session lows against the Swiss franc, with USD/CHF down 0.26% to 0.9228.
The greenback was weaker against its Canadian, Australian and New Zealand counterparts, with USD/CAD falling 0.21% to 0.9854, AUD/USD gaining 0.59% to 1.0577 and NZD/USD rising 0.49% to 0.8437.
The commodity linked dollars found support earlier in the session after official data showed that China’s trade surplus widened unexpectedly in December, adding to signs of a recovery in the world’s second largest economy.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.14% to 80.52.
The U.S. was to release its weekly government report on initial jobless claims later in the trading day.
